State Dept cable 1974-246584

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Message Text

CONFIDENTIAL

PAGE 01 CANBER 07509 160126Z
73

ACTION EA-10

INFO OCT-01 ISO-OO CIAE-00 DODE-OO PM-03 H-01 INR-05 L-02

NSAE-00 NSC-05 PA-01 RSC-01 PRS-01 SP-02 SS-15

USIA-06 AID-05 COME-OO EB-04 FRB-01 TRSE-00 XMB-02

OPIC-03 CIEP-01 LAB-01 SIL-01 OMB-01 TAR-01 /073 W

128166

R 160014Z NOV 74
FM AMEMBASSY CANBERRA
TO SECSTATE WASHDC 4504
INFO AMCONSUL SYDNEY
AMCONSUL MELBOURNE
AMCONSUL PERTH
AMCONSUL BRISBANE
AMCONSUL PORT MORESBY

CONFIDENTIAL CANBERRA 7509

E.O. 11652: GDS
TAGS: PFOR, US, AS

SUBJECT: AUSTRALIAN ECONOMIC AND POLITICAL SITUATION:

VIEWS OF RUPERT MURDOCK, MANAGING DIRECTOR OF
NEWS LTD. AND ASSOCIATED COMPANIES

DURING A WIDE-RANGING AND APPARENTLY VERY CANDID CONVERSATION
WITH AMBASSADOR, DCM AND PAO AT LUNCH NOVEMBER 15, RUPERT
MURDOCK MADE THE FOLLOWING COMMENTS OF INTEREST. AS OWNER
OF "THE AUSTRALIAN", "SYDNEY TELEGRAPH", "ADELAIDE
NEWS", AND MAJOR PAPERS IN BRISBANE AND PERTH (IN ADDITION TO
PUBLISHING EMPIRE IN UK AND US) MURDOCK IS WELL INFORMED AND
EXTREMELY INFLUENTIAL.

1. AUSTRALIAN ELECTIONS ARE LIKELY TO TAKE PLACE IN ABOUT
ONE YEAR, SPARKED BY REFUSAL OF APPROPRIATIONS IN THE SENATE.

ALL SIGNS POINT TO A LIBERAL-COUNTRY VICTORY, SINCE THE
ECONOMY IS IN DISTURBINGLY BAD CONDITION AND WILL PROBABLY
NOT IMPROVE MUCH OF THAT TIME. SNEDDEN WILL BE THE NEXT PRIME
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MINISTER. PHIL LYNCH, WHO HAS HANDLED HIMSELF WELL AND TAKES

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

THE TIME TO BRIEF HIMSELF ON THE ISSUES, WILL STAY ON AS
DEPUTY LEADER OF THE LIBERAL PARTY. ON PRESENT FORM HE ALSO
HAS THE BEST CHANCE OF SUCCEEDING SNEDDEN AS LEADER. MALCOLM
FRASER IS THE MOST BILLIANT AS WELL AS THE MOST COURAGEOUS
OF THE LIBERALS BUT IS REGARDED AS TMU INFLEXIBLE AND TOO
ARROGANT BY HIS COLLEAGUES. HE ALSO TENDS TO BE OVERLY
ABSORBED IN FOREIGN AFFAIRS AND DEFENCE.

2. MURDOCK, BY SWINGING HIS NEWSPAPER CHAIN BEHIND THE ALP,
PLAYED A SUBSTANTIAL ROLE IN THE LABOR VICTORY OF DECEMBER
1972. HE IS SATISFIED THAT HE TOOK THE CORRECT POSITION AT
THAT TIME, SINCE IT WAS ESSENTIAL TO HAVE A CHANGE AFTER 23
YEARS. LIBERAL/COUNTRY LEADERSHIP HAD BECOME INCREASINGLY
WEARY INTELLECTUALLY. HOWEVER, MURDOCK IS DISAPPOINTED BY
LABOR'S PERFORMANCE. HE EXPECTS TO SUPPORT THE OPPOSITION
IN THE NEXT ELECTION.

3. WHITLAM’S POLICIES HAVE HELPED CAUSE THE COUNTRY'S ECONOMIC
CRISIS. THE GOVERNMENT SHOULD BE PURSUING ECONOMIC POLICIES
WITH A MORE SELFISH DOMESTIC FOCUS. FOR EXAMPLE, THE 25 PER-
CENT ACROSS-THE-BOARD TARIFF REDUCTIONS, WHICH APPEALED TO
WHITLAM'S ORDERLAY LEGAL MIND AND LIBERAL OUTLOOK, WERE A BAD
MISTAKE AND CONTRIBUTED NEEDLESSLY TO UNEMPLOYMENT. A NUMBER
OF AUSTRALIAN INDUSTRIES REQUIRE TARIFF PROTECTION AND THIS
PROBLEM SHOULD HAVE BEEN STUDIED ON A SECTOR BY SECTOR

BASIS. THE GOVERNMENT SHOULD HAVE DONE MORE TO CONTAIN
INTEREST RATES AND SUPPRESS FOOD PRICES. ABOVE ALL, IT IS
INEXCUSABLE NOT TO REDUCE GOVERNMENT EXPENDITURES DRASTICALLY
AT THE PRESENT TIME TO COUNTER INFLATION. HOWEVER DEPLORABLE
ALP SOCIAL PROGRAMS MAY BE, THEY SHOULD BE POSTPONED IN PRESENT
CIRCUMSTANCES.

4. WHITLAM APPEARED TO ABANDON HOPE OF WINNING THE NEXT
ELECTION ABOUT THREE MONTHS AGO. HIS ENERGY SEEMS DEVOTED
TO MAKING HIS MARK IN HISTORY AS A GREAT RADICAL REFORMER OF
AUSTRALIAN SOCIETY. HE HAS BEEN A DISAPPOINTMENT AS PRIME
MINISTER, PRIMARILY BECAUSE OF HIS ARROGANCE AND LACK OF
HUMAN SKILLS AS A POLITICIAN. HE HAS NOT COURTED CAUCUS
BACKBENCHERS, A PRACTICE ESSENTIAL IN THE LABOR PARTY CONTEXT.

HE WAS VERY WISE TO APPOINT JOHN MENADUE, ONE OF THE SHARPEST
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POLITICAL MINDS IN AUSTRALIA, AS SENWETARY OF THE PRIME
MINISTER'S DEPARTMENT. IF HE LISTENS TO MENADUE, HE MAY
IMPROVE HIS POLITICAL TACTICS.

5. IN THIS CONNECTION, THE PROPOSAL TO UNLOAD FRANK
CREAN STEMMED FROM MENADUE. CREAN WILL ALMOST CERTAINLY
BE REMOVED BEFORE LONG. HE HAS BEEN A WEAK, INADEQUATE
TREASURER. REPEATEDLY, THE SHARP, INTELLECTUAL PROFESSIONALS

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

OF THE TREASURY DEPARTMENT HAVE SOLD A POLICY BILL OF GOODS
TO CREAN AND WHITLAM AND THEN, WHEN THESE POLICIES COME UNDER
FIRE IN CABINET AND CAUCUS, CREAN HAS SCUTTLED AWAY, LEAVING
WHITLAM ALONE TO DEFEND TREASURY'S FAULTY PROPOSALS. WHITLAM
WILL CERTAINLY BE DROPPING CREAN BEFORE LONG, AND WILL PROBABLY
GET AWAY WITH IT AFTER A FLURRY OF PROTEST. HOWZER, WHEN
HE MAKES CAIRNS TREASURER-A PROSPECT WHICH CAIRNS RELISHES
DESPITE HIS PUBLIC PRETENCE OF RELUCT ANCE-HE MAY FIND THAT
CAIRNS, A MORE FACILE POLITICIAN THAN THE PRIME MINISTER,

EMERGES UNSCATHED WHILE WHITLAM HIMSELF CONTINUES TO TAKE THE
BLAME FOR INFLATION AND THE POLITICALLY DISASTROUS UNEMPLOY
MENT.

6. CAIRNS REMAINS SOMETHING OF AN ENIGMA, A CHARMING, SUBTLE
POLITICIAN WHO SWAYS WITH HIS INTERLOCUTOR OF THE
MOMENT. IT IS STILL NOT CLEAR WHETHER CAIRNS IS IN FACT
BECOMING MORE MODERATE OR WHETHER HE IS MASKING HIS FUNDA-
MENTALLY LEFTIS MAKEUP UNTIL HE OBTAINS GREATER POWER. CAIRNS
NOW APPEARS VIRTUALLY UNCHALLENGED AS WHITLAM'S SUCCESSOR,
EITHER DURING THE PRESENT GOVERNMENT OR AS SOON AS LABOR RETURNS
TO OPPOSITION. IN POWER, CAIRNS IS NOT LIKELY TO MOVE

RAPIDLY TOWARD THE CORPORATE STATE. AS A PRACTICAL POLITICIAN
HE RECOGNIZES THAT PRIVATE BUSINESS REMAINS THE FOUNDATION
OF THE AUSTRALIAN ECONOMY. HOWEVER, HE WOULD PURSUE MORE
RADICAL FOREIGN POLICIES AND WOULD CONTINUE TO MOVE TOWAREN
SOCIALISM. CAIRNS RETAINS THE FULL SUPPORT OF THE ALP LEFT,

AND THE LEFT WILL INEVITABLY GAIN IN STRENGHT IF LABOR LOSES
GOVERNMENT. MURDOCK FINDS CAIRNS A PUZZLING AND DISTURBING
FIGURE.

7. WHITLAM IS QUITE CAPABLE EVEN IN THE NEAR FUTURE OF
BECOMING FRUSTRATED AND LAYING DOWN AN "ACCEPT MY POLICY OR
I QUIT" ULTIMATUM TO THE CAUCUS. CAUCUS MIGHT EASILY PICK
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UP THIS GAUNTLET AND DROP WHITLAM IN FAVOR OF CAIRNS.

8. BOB HAWKE IS FIERCELY AMBITIOUS TO BECOME PRIME MINISTER OF
AUSTRALIA AND COULD MAKE IT SOME DAY. HE IS INTELLIGENT AND
ESSENTIALLY MODERATE. HE WOULD BE FAR PREFERABLE TO CAIRNS
BUT HAS LITTLE CHANCE OF DEFEATING CAIRNS IN THE NEXT FEW
YEARS. HAWKE IS NOW TALKING "NATIONAL GOVERNMENT", WHICH
WOULD GIVE HIM THE BEST CHANCE PERSONALLY. HE SEES THE ALP
GOING DOWN TO DEFEAT AND DOES NOT WANT TO BOARD THE SINKING
SHIP.

9. IT IS NOT LIKELY THAT MUCH AMERICAN CAPITAL WILL BE
ATTRACTED TO AUSTRALIA IN THE NEAR FUTURE. RECESSION AT
HOME IN THE U.S. AND HIGH INTEREST RATES MAKE THIS UNLIKELY.

SEVERAL AMERICAN FINANCIAL INSTITUTIONS, EVEN LARGE ONES,

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

ARE ALREADY BADLY OVEREXTENDED IN AUSTRALIA AND THE BURSTING
OF ONE OF TWO BUBBLES WOULD BE VERY BAD FOR THE ECONOMIC
CLIMATE.

10. MURDOCK IS DEEPLY PESSIMISTIC ABOUT THE GLOBAL ECONOMIC
SITUATION. THE U.S., BECAUSE OF ITS GREATER DIVERSIFICATION
AND LESSER UNION PROBLEMS, IS IN BETTER SHAPE THAN AUSTRALIA
AND CERTAINLY THAN THE UK. THE U.S. IS THE ONLY SOCIETY
AND THE ONLY ECONOMY OF SUFFICIENT STATURE TO PROVIDE WORLD
LEADERSHIP IN THESE PARLOUS TIMES.

GREEN

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NNN

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Message Attributes

Automatic Decaptioning: X
Capture Date: 01 JAN 1994
Channel Indicators: n/a
Current Classification: UNCLASSIFIED

Concepts: ECONOMIC CONDITIONS, DIPLOMATIC DISCUSSIONS, POLITICAL SITUATION, POLITICAL LEADERS

Control Number: n/a
Copy: SINGLE
Draft Date: 16 NOV 1974
Decaption Date: 01 JAN 1960
Decaption Note:

Disposition Action: RELEASED
Disposition Approved on Date:

Disposition Authority: cunninfx
Disposition Case Number: n/a
Disposition Comment: 25 YEAR REVIEW
Disposition Date: 28 MAY 2004
Disposition Event:

Disposition History: n/a
Disposition Reason:

Disposition Remarks:

Document Number: 1974CANBER07509

Document Source: CORE

Document Unique ID: 00

Drafter: n/a

Enclosure: n/a

Executive Order: GS

Errors: N/A

Film Number: D740331-0455
From: CANBERRA
Handling Restrictions: n/a
Image Path:

ISecure: 1

Legacy Key: Iink1974/newtext/t19741 137/aaaabezk.tel

Line Count: 180

Locator: TEXT ON-LINE, ON MICROFILM
Office: ACTION EA

Original Classification: CONFIDENTIAL
Original Handling Restrictions: n/a
Original Previous Classification: n/a
Original Previous Handling Restrictions: n/a
Page Count: 4

Previous Channel Indicators:

Previous Classification: CONFIDENTIAL
Previous Handling Restrictions: n/a
Reference: n/a

Review Action: RELEASED, APPROVED
Review Authority: cunninfx
Review Comment: n/a
Review Content Flags:

Review Date: 09 JUL 2002
Review Event:

Review Exemptions: n/a

Review History: RELEASED <09 JUL 2002 by shawdg>; APPROVED <20 MAR 2003 by cunninfx>

Review Markings:

Declassified/Released
US Department of State
EO Systematic Review
30 JUN 2005

Review Media Identifier:

Review Referrals: n/a
Review Release Date: n/a
Review Release Event: n/a
Review Transfer Date:

Review Withdrawn Fields: n/a
Secure: OPEN
Status: NATIVE

Subject: AUSTRALIAN ECONOMIC AND POLITICAL SITUATION: VIEWS OF RUPERT MURDOCK, MANAGING DIRECTOR OF
TAGS: PFOR, US, AS, (MURDOCK, RUPERT)

To: STATE
Type: TE

Markings: Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005